How To Monetize Podcasts

We are trying something different this time – this history podcast is subscriber-only. The first episode is available for free as a taste-test, but the rest of the series is available only to subscribers. This is pretty unusual for podcasts, which are usually either totally free or operate with a freemium model, whereby you have the main series which is free, then you have to pay either for special VIP episode or for archived episodes. There is also advertising as a revenue model – but I already experimented with podcast advertising during my days running The Podcast Network v1, and I know the pitfalls of it. I decided that for podcasting to work as a business, it has to be paid for by the listeners.

We decided to test out the subscriber-only model because we figured it’s about time people started to think differently about podcasts. Ray & I collectively put about 80 – 100 hours of work into the Life Of Caesar (our other history podcast) each month and it’s a hell of a lot of effort. And we do that show for free. So to add another series on top of that, with the same amount of work, we needed to start to earn a buck out of it.

Of course the big question is always “will people pay for content they are used to getting for free?” We are all familiar with the attempts of large media companies to put their content behind paywalls and how poorly they have (apparently) worked out. On the flipside, though, people are used to paying a small amount of money for content services these days – iPhone apps, tracks in iTunes, Spotify, Netflix, etc. Our question is whether or not people would be prepared to pay a small amount each month to listen to more content from us?

We figured that it was worth an experiment – nothing ventured, nothing gained. For a few months we had been asking people to sponsor Life Of Caesar on a volunteer basis. Nearly 200 people had generously volunteered to contribute and the average amount seemed to be about $5 per month, so we wanted to see what percentage of our Caesar audience would be prepared to pay us that amount to produce more content.

My guess was that only a small percentage of our listeners would come on board – my goal was to reach 10% of our regular listeners (which I think is in the region of about 12 – 15,000 people, although podcast stats are hard to get a handle on – in total, the Caesar show gets about 120,000 mp3 downloads a month, but each new episode gets about 12 – 15,000 downloads) – so about 1000 subscribers would be a great result.

For a few years, Kevin Kelly, founding executive editor of WIRED Magazine, has been promoting this idea of 1000 True Fans:

“The gist of 1,000 True Fans can be stated simply: A creator, such as an artist, musician, photographer, craftsperson, performer, animator, designer, videomaker, or author – in other words, anyone producing works of art – needs to acquire only 1,000 True Fans to make a living.”

We like that idea. 1000 people sounds like a reasonable goal. Out of the million people who have enjoyed our previous podcasts for free over the last ten years, we hope we can find 1000 True Fans who are willing and able to support our work.

Fortunately, so far it’s been going very well. In the first six weeks we had over 300 people subscribe to the show and the feedback from them has been extremely positive. The show generated about $7000 USD in the first month. Okay – we’re probably never going to get rich off of this, but isn’t our goal. Still – $7000 is by far the most money I’ve ever received from listeners in one month. In ten years of podcasting, I’ve never even come close to that kind of support.

Our goal is to make a reasonable living from podcasting. If Ray and I can both get to a point where we are producing several series a month and earning a livable wage from it, I know we’ll both be very happy. This is what we love to do and apparently some people like to listen to what we do. Now – some people seem to think that’s ridiculous. I’ve had some email recently from people basically suggesting I’m a total douchebag for wanting to earn a living out of podcasting. My reply is always the same – do you go to work every day for free? Of course you don’t. So why should we?

The other argument I hear often is “people won’t pay for something they expect for free”. And I agree – most people won’t. But there are exceptions – the true fans. If you have some true fans and they really, really enjoy your schtick (and that’s important – for this to work, people really need to want to hear our content over and above all of the free content), then they seem to be willing to throw us the price of a cup of coffee for ~4 hours of entertainment a month. I don’t think that’s too much to ask and apparently a few true fans don’t think so either. When someone emails me and says something like “why would I pay for your content when I can get great podcasts for free?”, I think “hey that’s cool, I get it, you’re just not a true fan, no problem”.

The hardest part of all of this was setting up the infrastructure to be able to handle a paywalled podcast. I needed a solution that would integrate hosting, membership and billing. Unfortunately, that solution doesn’t seem to exist off-the-shelf for podcasting. So I had to cobble something together, working with a couple of developers to integrate disparate systems until I had something that would work. I’m writing a “Guide To Making Money From Podcasting” that I’ll make publicly available in a few weeks that will make the process of pulling all of the components together easy for others.

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2 thoughts on “How To Monetize Podcasts”

Thanks Cam, good post. Would be interesting to see the month on month growth or decline. Obviously you will get a lot at the beginning, hopefully with 2-4 months of growth as the show takes off. I would imagine it may slow to a trickle until you get to your next year subscriptions. A lot of other shows do a “drive” once a year, to bring in the bucks. Might be that’s the tried and ture method, but not sure. Would be interesting if you prove me wrong!